3. ZIM Integrated Shipping Services Ltd (NYSE:ZIM)
Higgins’ Stake Value: $55.5 million
Percentage of Brian Higgins’ 13F Portfolio: 4.55%
Number of Hedge Fund Holders: 25
Stock Price as of October 6: $45.13
ZIM Integrated Shipping Services Ltd (NYSE:ZIM) is an international cargo shipping company based in Israel. One of the largest container lines in the Middle East, the company has a market capitalization of $5.19 billion, and ranks third on our list of the 10 stocks to buy under $50 according to Brian Higgins’ King Street Capital.
According to the recent 13F Filings, Brian Higgins’ holds 1.23 million shares of ZIM Integrated Shipping Services Ltd (NYSE:ZIM), worth $55.5 million and representing 4.55% of his fund’s total investment portfolio. By the end of the second quarter of 2021, 25 hedge funds out of the 873 tracked by Insider Monkey held stakes in ZIM Integrated Shipping Services Ltd. (NYSE:ZIM) worth roughly $327 million. This is compared to 14 hedge funds in the previous quarter with stakes worth approximately $199.4 million.
On August 24, Barclays analyst Alexia Dogani raised the price target on ZIM Integrated Shipping Services Ltd. (NYSE:ZIM) to $50 from $40, and kept an Equal Weight rating on the shares.
The company issued its quarterly earnings report for the second quarter of 2021 on August 18, with a reported EPS at $7.39, surpassing market estimates by $1.57. Additionally the company’s revenue of $2.38 billion beat the estimated revenue for the quarter by $514.35 million.
In its Q2 2021 investor letter, Evermore Global Advisors declared ZIM Integrated Shipping Services Ltd. (NYSE:ZIM) as the largest contributor to the fund’s performance. Here is what they said:
“ZIM Integrated Shipping Services (ZIM) was the largest contributor to the Fund’s performance during the second quarter. With a market cap of $5.2 billion, ZIM is an Israel-based containership operator that had its initial public offering on the New York Stock Exchange this past January. As a reminder, we discussed ZIM at length in the Q1 2021 quarterly commentary as one of the new investments that we initiated during that period.
There were several notable developments during the second quarter. Given the company’s unique asset light business model and targeted, global niche approach, ZIM continued to generate exceptionally strong cash flows. ZIM ended the period with approximately $1.25 billion in cash and about $915 million in net debt. Due to the strong operational performance, the company further strengthened its balance sheet by redeeming its Series 1 and Series 2 unsecured notes due in 2023. With the early redemption of the unsecured notes, ZIM was no longer subject to certain dividend restrictions, and it declared a special dividend of $2 per share, which will be payable on Sept 15th (goes ex on August 24th). Lastly, management revised its 2021 fullyear EBITDA guidance from $1.4 – 1.6 billion to $2.5 – $2.7 billion, which was a sizeable increase compared to the levels set last March. To that end, we continue to have high conviction in our position in ZIM.”
